Senate Standing Committee on Local Government

Come to order. Good afternoon, and thank you for joining us. The Senate welcomes the public in person, and we are holding our committees hearings here in the Capitol Building. I ask all members of the committee, I think they're almost here, to be present in Room 112 so we can establish our quorum. We have one bill on today's agenda, AB 1768 by Assembly member Brian.

We will establish a quorum before you hear the presentation.

Senators Durazo?

Here.

Durazo here. Choi?

Hi. Here.

Arreguin here. Ashby?

Present.

Choi here. Arreguin?

Seyarto here.

Here.

Cervantes? Laird? Seyarto?

You have a quorum.

Thank you. And so, I think we're a quorum has been established, and we'll begin with assembly member Bryan. You may present your bill, AB 1768. Welcome.

Here. I'll take this one. Thank you, madam Senator. I think this might be my first time before this particular Senate committee.

We're the best.

Always always good to be with you. The most vulnerable communities in California continue to be attacked by the federal administration. As we saw as recently as last week, $1,600,000,000 in Medicaid reimbursements are being withheld from California. Los Angeles County projects losing a total of 2,400,000,000 over the next three years. Without additional local revenue sources, these cuts will affect the county departments that focus on providing Angelenos with quality health services.

The county is already instituting hiring freezes and has warned of potential layoffs affecting as many as 5,000 workers who keep the systems running every single day. More than nine clinics have already closed in Los Angeles County. Contra Costa County faces similar cost pressures as federal cuts cascade through Medicaid, SNAP, and other social safety nets. AB 1768 is a simple bill.

It's about whether local jurisdictions have the state's authorization to respond to federal funding cuts in the way that their voters and their constituents choose to.

I think that it's important to maintain this kind of local control. In fact, in many ways, the government should get out of the way of local jurisdictions and let them make the decisions that are most needed in this important time. This bill left the state assembly floor last week with a super majority of bipartisan support. I respectfully ask for your support today.

With me to testify are Angela Pontes, the senior VP of government affairs at Planned Parenthood California, and Dennis Cuevas Romero, the VP of government affairs at the California primary care association.

Thank you, Assemblymember. Go ahead. You may begin.

Good afternoon, madam chair and members. Dennis Cuevas Romero, vice president of government affairs with the California primary care association, the statewide association that represents community health centers and clinics in the state. I appreciate the opportunity. As you know, community health centers serve the most vulnerable or the backbone of our community. As the assembly member mentioned, the impacts of HR 1 and state budget decisions are already being felt.

Clinics have closed in Los Angeles County, there's staff shortages, reduced capacity to meet the needs of the primary care and behavioral health services, These impacts will only continue to grow. This bill, as the assemblyman mentioned, isn't a tax. It really empowers the community to make the decision to make sure that they continue to provide care for the safety net. And for those reasons, CPCA is in strong support and sponsoring the bill. So we ask for your aye vote.

Thank you.

Good afternoon. Angela Pontus on behalf of planned parenthood affiliates of California in support of AB 1768. In just LA County, two Planned Parenthood affiliates together operate 28 health centers and 26 school based sites. This is one quarter of all Planned Parenthood health centers in California. When the president signed HR 1 into law last year, Planned Parenthood health centers were immediately federally defunded.

We know that HR 1 also included many other devastating impacts to health care programs across the state. In response, LA County proposed a local solution by placing the essential services restoration act on the June ballot. If passed, this measure may raise about 1,000,000,000 to support health care services that were impacted by HR 1 in LA County, including planned parenthood.

AB 1768 will empower voters to decide how to address these federal cuts by facilitating the measure to be implemented legally if it is approved by the voters in June. We ask for your aye vote.

Thank you very much. Is there anyone here in opposition? Oh, I'm sorry. In support. Not yet.

Thank you, madam chair and members. Meagan Subers on behalf of the California Professional Firefighters in strong support.

Thank you.

Madam chair and senators, Terry Brennand on behalf of SEIU California. Strong support. Thank you.

Thank you.

Good evening, madam chair and members. Connor Gusman on behalf on behalf of Teamsters California in strong support. Thank you.

Madam chair, member Sarah Flocks, California Federation of Labor Unions in strong support. Thank you.

Allison Ramey, on behalf of the State Pipe Trade Council and the State Association of Electrical Workers, in support.

Jeff Neal representing Contra Costa County, also in support.

Thank you.

Good evening, madam chair and members. Jessica Hay with AFSCME California in strong support.

Thank you. Okay. Now is there anyone in opposition to this bill, AB 1768? Nobody in opposition. Okay.

Okay. What go ahead. Good evening.

Kira Ross on behalf of the cities of Glendale and Burbank in opposition.

Burbank and Glendale.

Okay. Thank you very much. Anyone else in opposition? Seeing none. Questions or comments from the dias?

Somebody? Senator Senator Seyarto?

Okay. Thank you. So normally, on these on these bills, I I tried to defer to the district. I figure if they wanna do this to their constituents, then that's on them. However, when it comes to LA County, it's a little personal.

Part of that personal is that I have a tremendous amount of family and friends that live in that district. And one thing and and they cross both lines. They're Democrats. They're Republicans. They're people in the middle.

And, one of the things that is constantly expressed to me just about every gathering that we have is they are so sick and tired of not having a voice, that says it pushes back on all these attempts to raise their taxes, to raise the cost of living. And usually, they don't see the return in investment from what they're promised on the glossy flyers that come out from the citizens for whatever it is.

Raising the sales tax another half percent from its 2% that has already been raised. Where where is the line where we start being more responsible with how we spend money? LA County's difficulties and the state's difficulties as far as health care started long before HR 1.

That was our own doing. We expand health care beyond what we could afford. But that being said, $220,000,000,000, especially $20,000,000,000 more from the Federal Government for medical, is not a cut. $20,000,000,000 more than last year. That's what we're that's what we're anticipating this next year.

So it's hard to say that we're getting cut. And the people that read the newspaper every day and start planning their retirement for outside of California because of what's happening to them. From them, I I would say a resounding no. Let's see some responsible spending before that. One other thing, I I know that every time we have one of these tax measures, and I used to resent this as a firefighter.

They plaster the firefighters all over that. Why? Because they're popular. Because people don't wanna say no to a firefighter. And, and I resent being used like that.

There are plenty of ways for us to prioritize and fund the things that are very important in this in this state and also in these counties. And and we're not doing that. And instead, we're relying on this constant push to raise taxes. A lot of people have said enough is enough. Their property taxes are just I mean, their properties have their values have gone way beyond what these properties should be valued at.

And therefore, their property taxes for people buying new homes are way beyond what normal people what other people pay in taxes. Our gas prices, when you're talking about sales tax impact, our gas prices are highest in the nation especially in LA. I was there last week as or two weeks ago. I was paying $6.75 a gallon for gas. That's all sales tax.

So it's it's pushing that even. So, you know, we have a lot of self inflicted wounds. Yes. We can we can try to blame the Federal Government for all our problems, but it is not the source of all of our problems. There are some issues that we have that have created exacerbated some of our problems, but they are not the source.

We are the source, and we keep pushing measures that make that worse. So, on behalf of all those people that I don't represent officially, but but I get to hear at the dinner table, I will not be supporting this. Thank you.

Well, thank you madam chair. I'm proud to be a co author of this bill, and as the only member from Contra Costa County who serves on this committee, there's another county that is included in this bill. It's not just Los Angeles. It's also Contra Costa County, and I think the author did a good job of putting this in context. This administration announced last week that they're withholding over a billion dollars in funding for Medicaid over allegations.

Mind you, allegations of fraud in terms of how the state is administering Medicaid benefits. No proof that fraud does exist in harming people that rely on those benefits for essential health, health care services. I wish that we didn't need this bill. I wish that this administration and the Republican majority in Congress did not pass HR 1, which created huge impacts on the delivery of health care and other essential services for people in California throughout this country.

But sadly, we're in the situation where we need to do everything we can to make sure that our residents have access to healthcare and nutrition assistance and other essential social services that they rely on for their livelihood.

And all this bill does is give the voters of Los Angeles County and Contra Costa County the choice, the choice about whether they want to approve a sales tax increase beyond the current limit. Impact on Contra Costa County, in terms of the impact of the the impact of HR 1 on Medicaid enrollment. And I'll also put this in context. I represent West Contra Costa County, a third of the county, which is the poorest part of Contra Costa County and also where we have the largest number of Medi Cal recipients.

So this disproportionately impacts my constituents, which is why I'm a fierce advocate for this bill, and why it needs to pass.

93,000 people in Contra Costa County, 93,000 are at risk of losing their medical coverage because of HR 1. In terms of CalFresh, an estimated 17,600 residents will lose their eligibility. We know that we can't backfill the impact of those cuts.

In terms of the impact, on our hospitals and clinics, $500,000,000 in funding reductions over the next five years and have projected $1,000,000,000 in operating deficits for hospitals and clinics in Contra Costa County alone, not even taking account Los Angeles County or other counties in the state of California. Nothing's more fundamental to our responsibility as elected officials than public safety and health care.

And right now, our health care system in both these counties and throughout California is at risk, which is why the voters of these two counties will be considering a measure and why this bill is essential to give them the ability to raise the funds necessary to make sure that we can maintain a central health care access for people in these two counties. I strongly urge my colleagues to support this bill and I move the bill the appropriate time.

Thank you, sir.

Thank you. Senator Choi.

We talk about a lot of affordability. That's not just a conceptual abstract policy discussion. We know how cost of living has risen, and gasoline price alone is LA and Orange County area is $6-7 per per gallon. And we add extra burden for many different reasons that we can come up with the extra tax burden for our citizens. And already working families feel that they are already paying the enough tax according to the p no.

PPIC statewide survey says 70% or more people feel like they are already we are already paying enough share of their tax burdens for many different areas. But now just because of HR 1 excuse, we try to add extra burdens. Once we allow these two different count these two counties, every other cities will come up with a special request. We are in the same situation as across the country and Los Angeles and a lot worse. Then what do we do?

I don't think this is one regional issue. This is a statewide issue that this is not the perfect time to raise and add additional burden for citizens with extra taxation. So for that reason, I won't be able to support.

Thank you. Any other comments? Yes. Senator Seyarto.

Based on the the comments about the the Medicare tax. Two years ago before you were here, Senator, we mulled over the MCO tax. And the reason we're mulling over the MCO tax and I was talked down to a lot about this because I said, you know, that sounds a lot like we're trying to trick the Federal Government into paying for something that they have never paid.

The Federal Government has never paid through Medicaid for people that were not citizens of of The United States, And we added them anyway, knowing that that is a state burden, a state burden. They've never ever done that.

When we did the MCO tax and doubled our tax, higher than anybody else in the country so that we could collect more from the the Federal Government supposedly making that into a reimbursable expense. They figured it out, which is exactly what I warned the body that they would probably do, is they'll figure it out later on. And guess what? That's what they did. And that's the cut you're seeing.

Not the 20,000,000,000. If they're really cutting, they get rid of the 20,000,000,000. The other thing I would say is, perhaps then, based on the the discussions about not being able to pay and it's a $1,600,000,000, we need to look at what our our May revise is talking about. The governor was on TV the other day touting upwards of $25,000,000,000 of which 12 of it is discretionary that we didn't anticipate that we would be getting.

So we have some choices there, and and we all have ideas about how we should go about looking at those choices.

But I think raising taxes at this point should be something that we put on hold from our perspective until we have a good grasp on what is supposed to be a very balanced budget from here till 2029 according to the governor. So we have money apparently, and we need to make sure that we are paying for what we decided. California decided that that's what the road we wanted to go down and add people onto onto the roles, and that's our burden.

And we can accept that, but we just have to be honest with our taxpayers and say, yes. We're the ones who did that, and therefore, we are going to take responsibility and figure out how to do it.

Hopefully, not by raising people's taxes again. That's that's my comment about that subject. Yes.

Senator Arreguin and then we're gonna stop.

I don't wanna have a back and forth, but I feel since my name was invoked, I should respond. I was not here, but I would have gladly voted to expand Medicare access to ensure that all people regardless of their citizenship status are covered. And you're right, that did have a budget impact, which is why we made certain changes last year when we adopted the budget. What I'm talking about is the impact of HR 1 and the ripple effect that's had in counties throughout California.

And once again, this bill is not the state of California imposing a tax increase on LA or Contra Costa County.

It's letting the voters of those counties make their own decision about whether to approve a tax increase or not. That's that's all this all all this measure does. And frankly, you know, respectfully, the administration and the Republican majority of Congress broke our system. And now you're not letting us, the counties make their own decision on how to fix it to make sure that people are gonna be able to maintain health care coverage and maintain nutrition assistance and other essential safety net services that people need.

For me, it's an easy decision, but I certainly respect your perspective on this issue.

Thank you. I also wanna add on to that. This is make it really clear. This is not making the decision to increase the sales tax today. This is about allowing the voters of LA County and Contra Costa County to make that decision.

And so I trust they will make the decision. I may like the outcome, maybe I won't like the outcome, but I still trust that they have the right to vote on this, and that's what we're that's what we're deciding today. We've done this with several other counties in the state. It's not the first time it's coming before us. And the the voters, you know, it just reminds me of our metro system.

Our our voters decided several times because they saw the results. They saw that it was working. We have a public transportation system that is really wonderful. And however this this this tax, potential tax increase gets handled, it's up to the voters. That's the most important thing to remember, and that's what we're voting on today.

Not yes or no on implementing a sales tax increase, It's on whether or not the voters get to decide. So with that, assembly member, you can, wrap up.

Thank you, madam chair, and thank you for the the conversation. I actually agree with my colleague from Orange County. I think this is a statewide issue. And I think when we talk about accountability, I think some of us need to be accountable for the person who's in the White House who's making the kind of decisions that have driven up our gas prices 5¢a day for the last several weeks.

In fact, told us just recently, a few days ago, that the financial strain on Americans is not his top concern right now, which is slightly different than what he ran on.

I think the chair was very clear, and I agree with her. This is not about whether we support a tax or not. It's about whether we believe that the people of Contra Costa and the people of LA County have the right to step up for themselves at a time when the Federal Government has targeted their residents, their most vulnerable and their sickest residents. Make no mistake, if we don't allow LA County to have this conversation at all, a county hospital will close.

And when a county hospital close, that impacts every part of the county ecosystem, including the firefighters who have extended wall times because they have no place to take anybody.

It also results in very difficult decisions. Do you cut from our fire safety and our emergency responses? Do you cut from our child welfare system and the foster children who are in it? Or do you allow our health care infrastructure, which is already not robust enough to crumble under the weight of a Federal Government that has targeted it. I don't want LA County to have to make those choices when the voters are asking for the right to make a different choice.

I trust them, and I think we should as well, and I respectfully ask your aye vote.

Thank you very much. Do we have a motion? Senator Arreguin moves the moves the bill. And, assistant, will you please call the roll?

The motion is do passed to the Senate floor. Senators Durazo?

Durazo, aye. Choi?

Choi, no. Arreguin?

No.

Aye.

Aye.

Arreguin, aye. Ashby?

Ashby, aye.

Aye.

Cervantes?

Cervantes, aye. Laird. Seyarto?

Aye.

No.

Seyarto, no.

Thank you. I'm gonna hold it.

4-2?

I'm gonna hold on. The bill is on call at four 4-2. He's he said he was gonna come.

Yeah. Yeah. He said he was gonna come.

Thank you. Okay. You, go ahead.

Yes. You'd like to

Aye.

File item number one, s, AB 1768. The motion is do passed to the Senate floor. Senators Laird?

Laird, aye.

Thank you.

Five-two?

The vote is five-two. Bill is out. Oh, oh, oh, oh, oh. This is it. Thank you to all the individuals who participated in public testimony today.

If you're not able to testify, please submit your comments or suggestions to the Senate local government committee. Your comments and suggestions are important to us. Thank you for your patience and cooperation. Thank you for the committee staff. Appreciate all of your work.

Oh, we're adjourned.